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You are receiving this mail every week as we see you as a key partner and we look forward to continuing to enjoy our journey with you over the decades ahead.
Please find below this week’s newsletter covering the latest M&A, company performance, fundraisings and executive moves.
Deal Details: London-based private equity company CapVest, founded by Cavan man Seamus Fitzpatrick, has acquired Tipperary meat supplier M&M Walshe for an undisclosed sum.
M&M Walshe has three trading arms: RibWorld, Callan Bacon and Stirchley Bacon. The company employs c. 550 staff between three sites in Tipperary, Kilkenny and one in the UK. In April 2019, M&M Walshe, revenue of c. €113.7m and a reported profit before tax of c. €655k. With add-backs, EBITDA is likely higher.
CapVest, founded in 1999, and is a leading mid-market private equity firm in the UK. The company’s investment strategy is focused on identifying and managing companies supplying essential goods and services.
| Advisers: Deloitte Corporate Finance Partners Ronan Murray and Jan Fitzell were the vendor’s Corporate Finance advisers on the sale process. ByrneWallace, led by Eamonn Carey, advised the vendor on legals. Renatus Comment: This acquisition will add to CapVest’ s already strong presence within the consumer foods space and will be integrated into the Eighty Fifty Food Group, owned by CapVest, and comprises Karro Food Group and Young’s Seafood. Karro Food Group is a meat processing business which CapVest acquired back in 2017 and Young’s Seafood was acquired last year. With all three companies combined, the Eighty Fifty Food Group is expected to generate sales of c. £1.4bn and will employ more than 7,500 people across 19 sites in Ireland and the UK. CapVest also owns a majority stake in giant food producer group Valeo Foods. Source: The Irish Times |
Deal Details: Paragon Group has this week acquired two UK-based companies: ZenOffice and Office Team.
Paragon Group is a world leading provider of customer communications, identification, graphics and business services.
OfficeTeam is a business services company providing a blue-chip client base with office and facilities supplies, furniture, print management, workwear & PPE, etc. In FY Dec’ 18 the business reported turnover of £131.7m and EBITDA of £3.0m.
ZenOffice is a similar company focused on the SME space providing managed print services (MPS), mail & fulfilment, signage & exhibition, workwear & PPE and business interiors. In FY Dec’ 18 the business reported turnover of £15.0m and EBITDA of £0.9m.
Advisers: None mentioned.
Renatus Comment: Paragon’s growth over the past decade has been exceptional under the leadership and majority ownership of Patrick Crean since 1998. He previously held the position of Group COO with Adare Group and held various positions with Clondalkin Group during the 1980’s.
In December 2010 the Paragon Group Ltd reported revenues of £128m and EBITDA of £6.6m and is now on a June 2020 run-rate of c. £1.1bn revenue and c. £95.7m EBITDA. A major contributor to this growth has been an ambitious M&A strategy with the group continuously bolting-on new capabilities, new locations and successfully integrating them. These acquisitions appear to be clever additions. The two businesses provide very similar services to separate ends of the market (large enterprises and SME) which together will cover the whole spectrum of business size. Together, synergies will likely be achieved and their offering will be enhanced by being a part of the Paragon Group structure.
Source: Paragon Group Press Release
Deal Details: Dublin-based Opening.io has been acquired by iCIMS Inc. for an undisclosed sum.
Opening.io has developed a software platform that can be tailored for customers, typically large enterprises, which helps them identify, target and hire individuals more effectively. Their platform leverages machine intelligence on top of existing large-scale recruitment processes. Capabilities include matching & ranking of candidates in relation to jobs, skills inference, and recommendations, CV summarizing, salary recommendations, parsing, and analysis of resumes.
iCIMS is a leading cloud platform for recruitment with thousands of customers in North America. iCIMS enables companies to manage and scale their recruiting programs with an end-to-end talent acquisition platform and an ecosystem of nearly 300 integrated partners.
In conjunction with the acquisition, the pair launched iCIMS Talent Logic, a new product combining the companies’ tools. The product’s objectives are shorter times to hire, lower costs to hire, and identification of the best talent to build workforces.
Advisers: Alan Kelly and team at Focus Capital advised Opening.io on the financials and Gar Smyth of Wallace Corporate Councel on the legals.
Renatus Comment: Large scale enterprises are increasingly hiring candidates with a global rather than local view, accepting applicants from all over the world for roles in offices around the world. With traditional manually intensive processes, these tasks would be extremely expensive and time consuming which creates a real need for products such as this.
Separately, this acquisition is a great result for initiatives such as Dogpatch Labs, Enterprise Ireland and the NDRC who all supported Opening.io on its journey to date. It is further validation that these initiatives produce results and is evidence of how vital they are for promoting entrepreneurship in this country.
Source: Opening.io Press Release
Deal Details: Ameresco is a North American renewable energy company who have this week acquired the Beale Hill Wind Farm in Co. Kerry for an undisclosed sum from First Electric.
This transaction marks Ameresco’s first project outside of North America. The wind farm has in place a power purchase agreement (PPA) for selling its output directly into the local utility network.
Advisers: An LK Shields team comprised of Seanna Mulrean, Philip Daly, Jamie Ritchie and Elaine O’Connor advised Ameresco on the transaction.
Renatus Comment: There are currently 368 wind farms on the island of Ireland and in 2017 wind power comprised 25% of our total energy generation. Green initiatives and energy efficiency are at the forefront once more in the current political climate and are an ever-increasing part of the nation’s psyche. As such, we should expect to see increased green energy capacity through new builds and an increased volume of secondary market transactions such as this.
Source: Ameresco Press Release, LK Shields Announcement
Deal Details: Medray Imaging Systems has acquired Carestream’s Medical Imaging business in the UK.
Medray Imaging Systems is one of the largest medical imaging supply and servicing companies in Ireland and was acquired by Erisberg last year. Medray will now become Carestream’s exclusive distributor for sales and service in both Ireland and the UK.
Carestream is a leading global provider of healthcare imaging equipment and has also been a long-time supplier to Medray in Ireland.
Advisers: None mentioned
Source: Irish Independent
It is reported that a number of private equity investors are eyeing up a potential investment in Chill Insurance, as the company enters the final stages of a strategic review which was sanctioned last year to explore a number of options to fund its future growth ambitions. It is believed that Livingbridge are the front-runners.
Chill Insurance is one of Ireland’s best-known insurance brokers and is owned by brothers Padraig and Seamus Lynch. The brothers hired the investment bank KBW to carry out a strategic review last year with options reported to include a trade sale, private equity investment or other financing options.
Livingbridge is a leading British private equity firm with a track record in the insurance industry. The company invests in companies with a value of up to £200m (€224m).
Source: The Sunday Times
It is reported that three private equity firms have made bids for Irish-Canadian company IPL Plastics. Any sale if it were to happen would open the door for an exit to Irish shareholders in the company including businessman Larry Goodman.
IPL is a leading packaging provider that partners with customers to deliver sustainable solutions to the food, consumer, agricultural, logistics and environmental end-markets. The company has 14 manufacturing facilities with over 400 molding machines.
It is understood that the three private equity firms that have made bids are: CapVest – a London-based fund led by Cavan man Seamus Fitzpatrick; Madison Dearborn – an American private equity firm known for its investment in the Jefferson Smurfit Group in 2002; Apollo – another American private equity giant that was founded in 1990 by Leon Black.
Source: Irish Independent
The ESB and Harmony Solar have committed an initial €30m to building solar power plants in Ireland.
Plants in Wicklow and Kildare will be initially developed with a target of 1,000MW capacity, enough to power an estimated 230,000 homes. This venture is part of the ESB’s wider ambition of pivoting away from fossil fuels and developing renewable electricity generation projects of scale.
Harmony Solar Ireland Limited is a fully Irish-owned Renewable Energy company located in Wexford that is acquiring surface rights, project rights and lease rights for the development of Solar Farm installations using Photovoltaic Technology (PV) in Ireland.
James Delahunt of KPMG advised Harmony Solar throughout this process.
Source: The Irish Times
EBITDA is an accounting term and is often the best indicator of profitability in non-capital-intensive businesses before financing and tax are considered. In capital-intensive businesses EBIT or EBITDA less average Capital Expenditure are often better measures. YoY is an acronym for the year-on-year movement in turnover, EBITDA, etc.
Findlater Hotels Limited, which trades as the Castle Collection, is a Dublin-based Irish-owned hotel group. The group includes seven properties located in Ireland, Scotland and Wales.
In its latest financial year, the company saw revenue increase by 11.8% to c. €13.8m while EBITDA was down 21.3% to c. €2.2m.
The Dublin-based group added to its collection in FY19 when it purchased the 72-bedroom Scotland Spa Hotel in Pitlochry from the Crerar Hotel Group.
The company is 100% owned by Fionn MacCumhaill.
Nicholl Oil is one of Ireland’s largest independent oil distributors. The business is owned by Loreen and Hugh Nicholl and has been trading for over 50 years.
Nicholl has a number of subsidiaries and accounts reflect group activities. For FY19, revenue increased by 23.3% to c. £349.0m while EBITDA increased by 3.1% to c. £3.1m. The business boasts an extremely strong balance sheet with effectively no long term loans and a c. £14.3m overdraft against a c. £43.3m cash balance which increased by c. £3.0m Y-o-Y.
Nicholl’s working capital requirement is heavily dependent on the movement in oil prices. The recent downward trend in global prices will surely be welcomed by the business.
Irish Pioner Works specialise in steel fabrication and galvanising. The company operates from its 5 acre premises in Cork and servcies a range of clients in both the public and private sectors.
In its financial year to March 2019, revenue increased by 8.6% Y-o-Y to €13.2m while EBITDA decreased by 17.5% to €1.3m. This was driven by gross margins moving from 25% in FY18 to 22% this year. Cash increased by c. €330k to stand at c. €2.8m.
Staff numbers at the company have almost doubled since 2014 and they now employ 96 people. Financials have followed a similar pattern in what appears to have been a great period for the business.
Who: Co Fermanagh gin distillery Boatyard Distillery, founded by Joe McGirr in 2016, has secured investment.
What: £634,000 (€710,600) comes through private investors in the HBAN and Co-Fund II.
Why: The purpose of funding was not disclosed however it is believed to be used towards expansion.
Source: Belfast Telegraph
Who: WorkVivo, Cork-based employee communications software company founded by John Goulding and Joe Lennon, has raised funding.
What: $16m (€14.7m) Series A funding round was led by US investment firm Tiger Global Management, which recently closed on a new $3.75bn private-equity fund. Dublin’s Frontline Ventures and Enterprise Ireland also participated.
Why: The funds will be used for expansion and product development.
Source: Irish Times
Who: Echelon Data Centres, a developer, operator and owner of a network of large-scale data centre campuses across Europe, has closed a capital raise.
What: €1bn investment program is backed by Pioneer Point Partners and Davidson Kempner European Partners. Echelon was advised by Rubicon Capital Advisors.
Why: The investment will cover the costs of Echelon’s planned infrastructure and renewable energy projects. These projects will be used to support Echelon’s 184MW IT load across its two locations in Ireland.
Source: Rubicon Capital Advisors
Who: Trinity Reliant Ventures Ltd parent company Artelo Biosciences Inc, a San Diego-based biopharmaceutical company, has been granted a US patent and received funding.
What: $4.2m (€3.89m) grant comes from the Cancer Institute of America into Stony Brook University in New York.
Why: The use of the funds was not disclosed however it is believed to be used for research and development.
Source: Artelo Press Release
Who: Irish video game specialist Keyword Studios plans to raise funds via share issue.
What: The company is looking to raise £100m (€113.7m).
Why: The money will be used for acquiring smaller rivals left struggling by the Covid-19 crisis.
Source: Irish Times
Who: Irish community groups to avail of new fund.
What: €5m Innovate Together Fund is an initiative by Department of Rural and Community Development, supported by the Dormant Accounts Fund.
Why: The fund is to support innovative community organisations who are coming up with impactful solutions to the problems posed by the Covid-19 pandemic.
Source: Irish Examiner
Who: InterTradeIreland’s Seedcorn Competition offers cash prize funding.
What: Total cash prize award of €280,000 will be available to businesses located across Northern Ireland, Dublin, Munster, and Connacht & Leinster.
Closing date for initial applications is 1pm on the 29th May 2020.
Why: The competition is open to independent incorporated ventures in the Seed, Start-up or Early Stage of business development, and ideally targeting international markets.
Source: Irish Examiner
Who: Mirai Technologies, a cancer research company which has developed new methods of fighting cancer using “electroporation”, has received funding.
What: The amount of funding has not been disclosed but it is understood that the PJ Hegarty construction dynasty is among the funders as well as former CRH chief Myles Lee and former Ulster banker Steve Dalton.
Why: It has not been disclosed what the use of funds will be but it is understood to be for R&D.
Source: The Sunday Times
We in Renatus believe that more important than the deals are the people and we have teamed up with leaders in this field Korn Ferry to provide you with details of key recent executive and board level appointments.
It’s been a while since we checked the betting markets for what leaders are likely to gain or regain power.
The bookmakers are struggling to split Donald Trump and Joe Biden for the US race and it is a whisker away from a toss of a coin in probabilities with Trump marginal favourite at 10/11.
Regarding next Irish leader, the market suggests the following probabilities:
65% Micheal Martin
32% Leo Varadkar
3% Mary Lou McDonald
4.5
The Ulster Bank’s purchasing managers’ index (PMI) for April 2020, the lowest since the survey began in 2000. A reading below 50 signals contraction.
@IrishTimesBiz
90.3%
The year-on-year drop in the new car registrations in Ireland for April 2020 amounting to 1933 new private cars licensed, according to @CSOIreland
80.3%
The year-on-year reduction in Northern Ireland’s footfall in all shopping locations for April 2020, according to retail experts Springboard. @BelTel
40%
The year-on-year increase in the number of available rental properties across Ireland as of May 1st 2020 amounting to 3,800 properties available for rent, according to Daft.ie. @IrishTimesBiz
56.7%
The year-on-year decrease in overseas travel to and from Ireland for March 2020 amounting to 635,000 arrivals and 602,100 departures, according to @CSOIreland
2%
The decline in the UK GDP for Q1 2020, the first official confirmation that the UK, including NI, is in the early stages of a recession, according to the Office for National Statistics. @BelTel
85%
The year-on-year drop in the number of flights handled by Irish airports for April 2020, according to the Irish Aviation Authority. @RTEbusiness.
3.3%
The year-on-year decrease in the agricultural price input while the output price index showed no change, for March 2020, according to @CSOIreland
0.1%
The year-on-year decrease in the consumer price index for April 2020 with the most notable changes in Communications (-8%) and Education (+4.1%), according to @CSOIreland
1%
The year-on-year increase in the Irish residential property price index for March 2020, according to @CSOIreland
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